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15/05/24
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USD Falls to One-Month Low Versus EUR
On Wednesday, the US dollar dropped to a one-month low against the euro as traders awaited a key U.S. inflation report that may affect the route of Federal Reserve policy.
The yen was close to a 2-week low as the gaping yield gap between Japanese and U.S. bonds continued to lead to selling of the Japanese yen.
In Asian trading hours, the euro edged 0.03% higher to $1.0823 and earlier lifted to $1.0828 for the first time since Apr. 10.
The U.S. dollar index, which measures its strength against 6 other major currencies, but is weighted heavily towards the euro – eased to 104.94, 0.11% lower after earlier dropping to a 1.5-week low of 104.92.
The long-term U.S. Treasury yield inched down to 4.4414%, extending an overnight retreat of 3.5 basis points.
The core consumer price report on Wednesday will likely show CPI in April rose 0.3% month-on-month, down from a growth of 0.4% the prior month.
Alan Ruskin, a Deutsche Bank strategist wrote in a note, the market was going to sink or swim together and pointed out the rare concentration of analysts forecasting 0.3%.
He added that rate path expectations were more sticky than normal and would need more than a single slight downside or upside surprise to move markets considerably.
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